The Day – warning signs of fraud and unfavorable credit terms
The effects of COVID-19 have created financial hardship for homeowners across the country. In fact, a recent study by OnePoll in collaboration with the National Association of REALTORS® found that more than 8 in 10 American homeowners – 81% – the COVID-19 pandemic caused them unexpected financial hardships.
“The impact of COVID-19 has resulted in some homeowners taking desperate steps to ensure they can protect their investments. Fraud activity increases during times like these, so homeowners need to remain vigilant and be wary of offers that sound too good to be true, ”said ECAR President Bonnie Nault.
Here are some warning signs of fraud and unfavorable credit terms:
Sounds too easy
“Guaranteed Approval” or “No Income Verification” regardless of the borrower’s current employment, credit history and assets.
Big future cost
High-risk, variable-rate mortgages, where the payment increases significantly after the “teaser rate” period, are rarely suitable for families who have had problems paying back other loans.
Prepayment penalties that make it difficult for a borrower to refinance to pay off an expensive loan by taking out a cheap loan.
No down payment loans
These loans can be split into two mortgages, one of which has a much higher cost. Home buyers should be sure that they can afford the payments.
Unethical document management
Ethical lenders and brokers will never ask you to sign a blank document or a document dated prior to the date it was signed.
Rent for self-fraud
The hire purchase landscape can be a minefield of scams and deception designed to steal your money – and leave sellers and buyers in the dust.
If you as a homeowner are struggling or unable to meet your loan obligations, work with real estate experts and your lender today to find a solution. Don’t wait until you get behind to seek help. Acting quickly can help you keep your home and the money you’ve already invested.
REALTORS® is in the business of helping people become homeowners and wants to do everything possible to ensure you can afford to stay in your home and protect yourself from potential scams. If your current lender is unwilling or unable to help, you may be able to refinance your current mortgage with another lender. REALTORS® may also be able to help you find responsible lenders who offer fair and affordable credit. Contact the Eastern CT Association of Realtors or visit www.easternctrealtors.com to find an associate lender, or speak to a member of the National Association of REALTORS® to learn more.